U. S. Government Printing Office Office of the General Counsel Contract Appeals Board Appeal of Mill River Press Lithographers, Printers August 12, 1977 Vincent T. McCarthy, Chairman Jay E. Eisen, Member Drew Spalding, Member Panel 75-2 This is the decision of the Contract Appeals Board in an appeal filed by Mill River Press Lithographers, Printers, 65 Prince Street, Brooklyn, New York 11201, herein also referred to as the Contractor or Appellant. This appeal was filed on January 2, 1975, appealing the rejection of a printing of a book under GPO Jacket No. 470-879, Purchase Order No. 59369. The appeal is brought under Article 29, U.S. Government Printing Office Contract Terms No.,l. Statement of the Case On May 21, 1974, the Government Printing Office, hereafter GPO) accepted the bid of the Contractor for the printing of 6,990 books for the Library of Congress entitled "Viewpoints: A Selection From the Pictorial Library of Congress." On December 4, 1974, the GPO in the final decision of the Contracting Officer rejected the books produced by the Contractor because the paper was not equal to the specifications and the printing was not good, clear and sharp with full and uniform ink coverage. The decision of the Contracting Officer further required that the books be "replaced in strict accordance with the specifications at no additional cost to the Government. . . ." On January 2, 1975, the Contractor appealed this decision to the Public Printer stating, inter alia, ". . . that the book is commercially acceptable and saleable, and that the shortcomings, such as they are, are more the fault of the Government Printing Office than Mill River Press" and that the problems with the paper were due to the mitigating circumstances of a "serious paper shortage at the time and we had the pressure of the contract schedule." The Contractor reprinted the books pursuant to the decision of the Contracting Officer and the second printing was accepted by the Government. The issues in the appeal are whether the rejection of the first printing by the GPO and the requirement that the Contractor reprint the book at its own cost were proper under the Contract. (Article 13, Contract Terms No. 1.) Jurisdiction The Contract Appeals Board (hereafter designated as the Board) has authority (jurisdiction) to decide disputes between GPO and its contractors which cannot be resolved at the Contracting Officer's level. It derives this authority from the "Disputes" clause, Article 29, U.S. Government Printing Office Contract Terms No. 1, which is incorporated by reference into the contract. It is not necessary to spell out the language stated therein, except that the Board has been appointed by the Public Printer as "his duly appointed representative for the determination of such appeals . . . . In connection with any appeal proceeding under this clause the Contractor shall be afforded an opportunity to be heard and to offer evidence in support of his appeal." The Board convened on March 28, and April 5, 1977, and afforded appellants a full opportunity to present the merits of this appeal. A contract reporter was retained to provide a verbatim transcript of the hearing. Findings of Fact GPO Jacket No. 470-879 was for the production of 6,990 case bound books for the Library of Congress entitled "Viewpoints: A selection From the Pictorial Collections of the Library of Congress." The books were to be printed on "white opacified offset must be equal to GPO Lot No. 24a weight 120" paper casebound, packed and shipped complete on or before September 5, 1974. (Emphasis added.) The specifications provided that the GPO would furnish a "complete set of offset film negatives ready for imposition, contractor to create stamping media for cover from furnished negative." (Emphasis added.) The bid of the Contractor in the amount of $27,853 was accepted by GPO on May 21, 1974, and Purchase Order No. 59369 was issued on May 22, 1974. Subsequent to this date, the Contractor telephoned Mr. David Logan, a GPO Contracting Officer to inform him that many negatives furnished by the GPO were damaged, marked and full of holes. Mr. Logan responded on July 15, 1974, that he consulted the specification writer, who advised him that the photographs of the negatives were old and had scratches and cracks but that the negatives were "okay to go ahead and print the job with the furnished negatives; that the negatives are good enough to do a satisfactory job . . . that we will accept the best results from the negs as furnished." (R 41, 42, 43, 45.) On September 19, 1974, the GPO was advised by the Library of Congress that they rejected the publication for inferior quality. The customer agency listed about 140 specific complaints about the printing quality of the books relating to pin holes, dust spots, variations in color intensity, smudges, white marks, loss of detail, and untrimmed end paper. The Contractor was notified on October 9, 1974, of the complaints of the Library of Congress. A request was made to the Library of Congress to accept the books at a reduction of 25 percent, but the proposal was rejected. (R 94, 121.) A comparison of halftone and line negatives furnished by GPO on Jacket 470-879 for use of the Contractor was made by the GPO Offset Negative Section on or about November 1974 and as a result, it was concluded that the tone value from the whitest highlight through varied greys to the black of the shadow area was consistent with the original copy. The halftones were compared with the original copy and it was concluded that the negatives prepared by GPO and delivered to the appellant were of good quality and ready for imposition. (R II-13, 17, 18.) The Superintendent of Typography and Design Division, GPO, reported to the Contracting Officer on November 20, 1974, that the product was unacceptable, citing overall poor workmanship resulting in "excessive lint and dirt on the halftone illustrations and total lack of full and uniform coverage." He noted the lack of folios on 11 pages which were on the negatives furnished by the GPO. It was further noted that the GPO test of the paper stock used revealed that it was below the quality required by the contract specifications in "opacity, pick qualities and across direction - folding endurance;" that many of the discrepancies in the printing of the book, i.e., lack of detail and dirty conditions of the illustrations, were due to the use of this unspecified stock. While he noted that some errors in the negatives were due to GPO, it was noted that these defects alone would not be serious enough to warrant rejection. On his recommendation, the job order was totally rejected and ordered reprinted at no additional cost to the Government. (File Exhibit 12, R 98.) Mr. John Tanner, a GPO Printing Technologist, possessing a background in the study of paper science at Syracuse University and experienced as a quality superintendent at a paper mill, participated in the October 11, 1974 testing of the stock used in the initial printing. It revealed that the pick test of the paper failed to meet the required standard of 13; that the analysis of the paper indicated a standard of 10 and that it may be interpreted that the paper had a soft surface; that when the blanket of the press lifted up, the wood picks caused white spots to appear in the halftones and resulted in the poor quality printing of the first job; that the use of the substandard paper was the major cause of the deficient printing and therefore, the basis for the rejection of the first printing. (R 11, 68, 75.) The Issues It is the position of the Appellant that they should be compensated for the initial printing because their failure to deliver acceptable items was not the fault of the Appellant. The Appellant contends that the specifications should have provided additional specifications to apprise the Contractor of the high quality product desired by the agency with respect to the standard of printing; that A-l printing would be required; that advanced proof sheets should be sent to to the GPO for prior approval and a requirement that Dylux proofs or other reference material be furnished the Contractor. The Contractor also alleges the negatives had flaws and had holes. The Government answers that the specifications used in the contract were primarily performance specifications and that Appellant's failure to produce an acceptable printing job was for the following reasons: 1. The paper upon which the books were printed did not conform to the specification. 2. The printing was not "good, clear and sharp with uniform ink coverage." (File Exhibit 14.) Opinion As to the first basis for rejection, the Contractor admits that the paper used to produce the initial printing was not in accordance with the specifications. Appellant contends, however, that the serious paper shortage of 1972 was a mitigating circumstance requiring lenient consideration by this Board. The general rule regarding mitigating circumstances is that the Contractor shall not be liable for excess costs if the failure to meet his obligations under the contract arises out of "causes beyond the control and without the fault or negligence of the contractor." Such causes are set forth in the contract and include, but are not restricted to "acts of God or of the public enemy, acts of the Government in either its sovereign capacity or contractual capacity, fires, floods, epidemics, quarantine restrictions, strikes, freight embargoes, and unusually severe weather." (Article 18(c), GPO Contract Terms No. 1.) Although a shortage of supplies is not mentioned in the contract list of excusable causes, there have been cases which considered such a factor to be a mitigating circumstance beyond the Contractor's control. However, these cases uniformly require the shortage of supplies to be abnormal and unforeseeable. American Emblem Co., Inc. (1943) NDBCA No. 38, 1 CCF 90. The Contractor should have looked into this matter prior to submitting the bid. Lack of diligence in securing timely assurance of the proper paper was not without the Contractor's fault. Mere difficulty in obtaining or unavailability in the usual course of business does not constitute impossibility of performance so as to excuse default in the absence of a clear showing that such conditions were so abnormal, extraordinary or unusual that they could not have been foreseen or anticipated at the time of making the contract. Thermo Nuclear Wire Industries, ASBCA, 61-1 BCA ¶ 2869. The failure to procure the required quality of paper for contract performance was not excusable in this case. The burden of proof is on the Contractor to demonstrate that failure to obtain the proper supplies was due to causes beyond the Contractor's control. Beco, Inc., ASBCA, 1964 BCA ¶ 4403; Highway Products, Inc., ASBCA, 69-2 BCA ¶ 8064. The Contractor admitted using paper not in accordance with specifications in printing the initial job. Therefore, Appellant assumed the risk of the possibility that the quality of the type of paper used could result in an unsatisfactory end product. The second point of rejection according to the final decision of the Contracting Officer was that the printing was not good, clear and sharp with uniform ink coverage. By the very nature of the contract, the Appellant in this case was required to perform in accordance with the requirements of the contract. It called for workmanship in connection with the product to be "first class". The Contractor was required to perform exactly in accordance with the details of the specifications. In this case, the specifications required the Contractor to print a book from "a complete set of offset film negatives ready for imposition." Although the original halftones were old, the evidence as adduced disclosed that the negatives were suitable for printing the required end product. The Government impliedly warranted that the negatives would produce a satisfactory end product. The term "a complete set of offset film negatives ready for imposition" means that the negatives are ready to print and that the Contractor does not have to make proofs, do stripping, mending or opaquing. The appellant contended that the specifications should have contained additional provisions such as apprising the Contractor that A-l printing is required, proof sheets be approved by GPO, and Dylux proofs or other reference material be furnished the Contractor. However, the weight of the evidence reveals that the use of the substandard unspecified paper stock was the major cause of the deficient printing and, therefore, sufficient basis of the rejection of the initial printing. We are unable on this record to conclude that the Government knew or should have known that the Contractor was producing the job with the use of unspecified paper stock. On July 15, 1974, the Contractor telephoned Mr. Logan of the GPO in reference to the quality of the negatives, but did not advise the GPO of its problem concerning the use of unspecified paper. The contract provides the following: "In the event the bidder cannot furnish any of the paper specified by the Government, he may submit an alternate bid specifying the kind and weight of paper he will furnish, provided that such alternate paper is suitable for the intended use of the end product in respect to weight, opacity, thickness and writing quality. In the event the bidder submits an alternate bid, he must submit with his bid 25 sample sheets . . . of the paper he proposed to furnish. The Government reserves the right to reject any alternate papers which in its opinion are not suitable for the intended use of the end product. Alternate bids will only be considered for award in the event no bids are received which offer to furnish the paper specified by the Government." As indicated heretofore, the major cause for the low quality of the printing, which lacked sharpness, clarity and uniform ink coverage, was the Contractor's use of unspecified paper. The award was made to the Contractor on the basis of being the low responsive, responsible bidder, whose bid took no exception to the Government specified paper options. Appellant's use of unsuitable paper under the circumstances was at their own peril. While we are sympathetic to the Contractor because of their financial loss, we feel that the responsibility in this case rested with the Contractor who is required to perform in accordance with the.specifications; in deciding where the risk of loss is to fall, we must balance the respective fault involved and weigh the reasonable expectations of the parties which the facts of the particular case support. On the record before us, we conclude that the direct cause of the failure to perform and produce a satisfactory publication, was not deficient or incomplete specifications, but rather the failure of the Appellant to assure the proper paper availability prior to obligating the Contractor to deliver and to use specified paper. Therefore, this appeal is denied.